3 1 figure "$250,000,000" where it appears therein to 2 "$1,000,000,000”. 3 SEC. 5. Section 1319 of the Housing and Urban De4 velopment Act of 1968 (Public Law 90-448; 82 Stat. 5 476), is hereby amended by changing the figure 6 “$2,500,000,000" where it appears therein to "$10,000,7 000.000". This is in further reply to your request for the views of this Department on S. 2901, a bill which would amend the flood insurance provisions of the Housing and Urban Development Act of 1968. Section 2 of the bill provides that the Secretary of Housing and Urban Development, in determining areas in which flood insurance is to be made available, shall afford a priority to those areas declared a major disaster area by the President subsequent to August 1, 1969. While we have no strong objection to this provision we believe that the Secretary has sufficient authority under existing law to establish such priorities administratively and that this would be a more flexible and desirable approach. Section 3 of the bill would prohibit the Secretary from establishing any land management or land use criteria for flood prone areas which have the effect of encouraging or requiring State or local governments to adopt measures which (1) prevent or prohibit an owner of residential property from repairing, rebuilding or reconstructing a residence on his property or (2) prevent or prohibit the use of land for commercial or manufacturing purposes where it is usual, customary or necessary that a particular business or manufacturing establishment be situated on such land. This Department is strongly opposed to enactment of this section. One of the major purposes of the National Flood Insurance Program is the encouragement of local actions to reduce the exposure of property to future flood damages. Under the National Flood Insurance Act of 1968 the adoption and maintenance in force of appropriate land use and land. management measures by local jurisdictions is the principal long-run means for reducing economic and personal loss resulting from floods and accordingly moving towards the two goals of (1) reducing the hazard to a scale which can be accommodated within traditional private-enterprise insurance techniques, and (2) ainimizing the need for extensive Federal budget expenditures for uninsured disaster relief. Enactment of section 3 would effectively megate this effort, by allowing customary land development or redevelopment practices in flood prone areas to continue, protecting property owners by subsidized insurance. In effect, the National Flood Insurance Act would become a vehicle to encourage, rather than discourage, additional property development that is exposed to flood damage. Sections 4 and 5 of the bill would increase the face amount of flood insurance authorized to be written and the amount which the Secretary is authorized to borrow from the Treasury for purposes of the program. The continued growth of the flood insurance program may eventually make an increase in these authorities necessary but there is no need for this action at the present time. The Bureau of the Budget has advised that there is no objection to the presentation of this report from the standpoint of the Administration'a program. Sincerely, /s/ George Romney George Romney 91ST CONGRESS 1ST SESSION S. 3025 IN THE SENATE OF THE UNITED STATES OCTOBER 14, 1969 Mr. JAVITS (for himself, Mr. HART, and Mr. SCOTT) introduced the following bill; which was read twice and referred to the Committee on Banking and Currency A BILL To assist the States and their localities in utilizing land resources more effectively and in providing housing to meet present and future needs, and for other purposes. 1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 3 That this Act may be cited as the "Urban Land Improve4 ment and Housing Assistance Act of 1969". 5 6 7 8 9 DEFINITIONS SEC. 2. As used in this Act (1) The term "Secretary" means the Secretary of Housing and Urban Development. (2) The term "locality" means any State, or any |